TOKYO -- The Japanese government will provide support for the employment of members of the so-called "lost generation," who graduated from high school or university into a serious job crunch after the collapse of the bubble economy in the early 1990s. The government plans to draw up support measures later this month, a government source told Nikkei.
It is a rare measure to throw a lifeline to people in their mid-30s to early 40s because they fell into a difficult labor situation compared to other generations due to harsh economic conditions both at home and overseas.
Training providers will receive subsidies if job-seekers stay in permanent jobs for six months. More than 6 million members of the lost generation are part-timers, unemployed or not in the labor force. Of them, about 1 million are estimated to need help. The measure will, it is hoped, help remove a sense of alienation from society by raising such people's incomes to boost consumption and contributions to social security.
The Council on Economic and Fiscal Policy said that 80,000-120,000 people graduated from high school and college with no job lined up every year from 1997 to 2004, three to five times more than the current level.
The number of Japanese aged 35 to 44 who have no jobs at all or work part-time jumped to 920,000 in 2018, from 570,000 in 2003. Their income levels appear to be are lower than those of regular employees due to their unstable employment situation. Many of them live as shut-ins.
According to the analysis by the Japan Research Institute, households with two or more workers in their early 40s -- who were born between 1975 and 1979 -- spend about 300,000 yen ($2,828) a month. That is around 25,000 yen less than people who were born between 1965 and 1969 in their early 40s and about 70,000 yen less than the first baby boomers, born between 1947 and 1949.
People in their 30s and 40s tend to spend more to buy houses and pay for their children's education. Therefore, a fall in consumption in this age group "casts a shadow on the overall economic growth of the country," said Yusuke Shimoda, senior economist at the Japan Research Institute.
Low incomes and sluggish consumption could shake the foundation of future pensions and health insurance, as well as increase the risk to welfare services when they get old.
If middle-aged and older part-timers and unemployed persons end up on welfare, an additional 20 trillion yen of social security payments will be necessary, according to estimates by the Nippon Institute for Research Advancement.